conference date: November 10, 2014 @ 1:30 PM Pacific Time
for quarter ending: September 30, 2014 (Q3, third quarter 2014)
Basic data (GAAP):
Revenue was $ million, sequentially from $28.0 million, and % from $ million in the year-earlier quarter.
Net income was negative $ million, sequentially from negative $27.9 million, and improved from negative $ million year-earlier.
EPS was negative $, sequentially from negative $0.27 and improved from negative $ year-earlier.
In the quarter a potentially $970 million license and collaboration agreement with Baxter International for sales of MM-398 outside the U.S. and Taiwan. $100 million was received upfront, but not recognized in Q3, with $47.5 million to be recognized over 1 year. Some of the funds will be used to commercialize MM-398 for 2nd line post-gemcitabine pancreatic cancer within the U.S.
All revenue in the quarter was from the recognition of the now-terminated MM-121 agreeement with Sanofi.
HERMIONE Phase 2 trial for MM-302 for HER-2 positive breast cancer was initiated.
Upcoming milestones include submitting an NDA for MM-398 to the FDA by Q2 2015 and presentation of Phase 3 results in January 2015. Earlier in November the initiation of a Phase 1 trial for 398 for brain cancer was announced.
Merrimack will be initiating an MM-141 Phase 2 clinical trial in 2015 for pancreatic cancer, which last week was given orphan drugs status by the FDA. Data from the Phase 2 MM-111 clinical trial in gastric and esophageal cancers in is due in 2015.
See also the Merrimack Pipeline.
Cash and equivalents ended at $153.7 million. Cash flow from operations was $61.1 million (but will be recognized as revenue over time).
Merrimack believes it has cash to fund operations into the second half of 2015, or later if Baxter milestones are realized.
Operating expenses were $51.7 million, consisting of: $43.6 million for R&D; and $8.1 million for general and administrative expenses. Operating profit was negative $23.7 million. Other expenses (mostly non-cash imputed interest) were $4.3 million. Net loss was $28.0 million, of which $27.9 million was attributable to shareholders.
Analyst Day will be December 18.
The FDA's request on the assay for MM-398, causing a delay, is not related to the efficacy of the drug, it is meant to assure the quality of the drug. We do not believe there is risk of further delay.
Competition with other HER-2 breast cancer therapies? We are advancing MM-302 to be a third-line option for patients who have already been on HER-2 positive therapies.
We are making progress on building our commercial force, we have talked about the delay and so will slow down to match the new timeline.
At analyst day we will discuss commercial launch plans for 398 and development plans for 398 with Baxter; plans for moving 121 to registration studies; rest of pipeline.
Plans with 141 are to do a Phase II study next year, on top of existing standard of care. It will be a stratified way, treating patients with biomarkers. We might later combine with 141 with 398.
Timeline for glioma (brain cancer) trial? We are excited about this trial. Direct injection of the drug into the brain could have a half life of a week. The investigators are independent, at UCSF. They will be reporting out data, according to their own timeline.
398 Assay, is that already in the industry? We have an existing assay that we have been asked to increase the release specification for it. The nanoparticle field is emerging, so the FDA wants the specifics of each program. Our work with them could create some of the standards for this field going forward.
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